LONDON/PARIS, Sept 4 (Reuters) - European shares marked time on Thursday after sharp gains in the previous session as investors waited to see whether the European Central Bank would unveil further measures to avoid deflation.

Shares in Standard Life bucked the trend and surged 7.9 percent after the financial services group agreed to sell its Canadian operations for about $3.7 billion to Manulife Financial.

At 0929 GMT, the FTSEurofirst 300 index of top European shares was down 0.1 percent at 1,384.23 points, edging off a two-month high hit in the previous session.

The benchmark index has gained nearly 7 percent since early August, fuelled by speculation the ECB may do more to stimulate the economy, possibly launching an asset-purchase programme, known in the market as quantitative easing (QE).

"Stocks have been retracing the summer correction, but the rally now lacks momentum ahead of the ECB. A lot has been priced in already so risks are on the downside if Draghi disappoints," FXCM analyst Vincent Ganne said.

The ECB faces intense market pressure to take policy action on Thursday and risks losing credibility if it fails to back up a dovish message delivered by President Mario Draghi late last month.

Though other central banks have used QE, hawkish members of the ECB's 24-member policymaking council are resistant.

"If he announces quantitative easing, and I would be surprised, we would see a rally," Shai Heffetz, managing director of spreadbetting firm InterTrader, said.

"The combination of comments about a weak European economy and no action, however, may cause the market to come off."

Heffetz said he would buy on any market dip, however, in light of improving economic data outside Europe, and especially in Britain and the United States, and easy monetary conditions.

"Open interests for call options on the STOXX 600 euro zone bank index have surged over the last week. 1.5 billion euros notional was traded since the beginning of this week, compared to 500 million euros on puts," the strategists said in a note.

The ratio measuring the number of negative 'put' options versus bullish 'call' options on the euro zone's blue-chip Euro STOXX 50 index - the most liquid European market for options traders - has dropped sharply in the past three weeks, hitting 0.93 earlier this week, down from 2.45 in early August.

The euro zone banking index - which has surged 12 percent since early August but remains 9 percent below the year's highs hit in April - was down 0.1 percent on Thursday.

Among mid-cap stocks, German industrial services and construction group Bilfinger tumbled 10.6 percent after it slashed its 2014 profit forecasts late on Wednesday. The group said it needed a "fundamental reassessment of the situation" in its power division, which accounted for a third of its operating profit last year.